MAJOR MOTION PICTURE STUDIOS are suing Kim Dotcom's Megaupload.
The Motion Picture Association of America (MPAA) has filed a lawsuit against the cloud storage outfit that was closed down over two years ago, and has done so with the backing of Twentieth Century Fox, Disney, Paramount Pictures, Universal City Studios, Columbia Pictures and Warner Bros.
20th Century Fox, Disney, Warner, Universal, Columbia, Paramount, I'm canceling movie night tonight ;-)— Kim Dotcom (@KimDotcom) April 8, 2014
The complaint alleges "massive copyright infringement" and Megaupload and its people are accused of enabling and encouraging 'piracy'.
"When Megaupload.com was shut down in 2012 by US law enforcement, it was by all estimates the largest and most active infringing website targeting creative content in the world," said Steven Fabrizio, senior executive VP and global general counsel of the MPAA.
"Infringing content on Megaupload.com and its affiliates was available in at least 20 languages, targeting a broad global audience. According to the government's indictment, the site reported more than $175m in criminal proceeds and cost US copyright owners more than half a billion dollars."
Named defendants are Megaupload Limited, majority shareholder Vester Limited, founder Kim Dotcom, CTO Mathias Ortmann and programmer Bram van der Kolk.
Megaupload is accused of offering incentives to users who uploaded popular content, and the MPAA said that users were paid sums dependant on the amount of traffic their content attracted. It said that the bulk of files on the website were "stolen movies".
"Megaupload paid users based on how many times the content was downloaded by others - and didn't pay at all until that infringing content was downloaded 10,000 times. Megaupload wasn't a cloud storage service at all, it was an unlawful hub for mass distribution," said Fabrizio.
"To be clear, if a user uploaded his term paper to store it, he got nothing - and, in fact, unless he was a paying subscriber, Megaupload would delete the paper if it was not downloaded frequently enough. But if that same user uploaded a stolen full-length film that was repeatedly infringed, he was paid for his efforts."
He added that this turned Megaupload from being a storage facility, as claimed, into a "business model designed to encourage theft - and make its owners very rich in the process".
Dotcom has disagreed with some of this, and on Twitter he denied that people were paid for popular uploads. "Files above 100MB filesize did not earn rewards on #Megaupload. Hollywood claims that we were paying users to upload pirated movies. Stupid," he said.